We develop a new algorithm based on the time-dependent variational principle applied to matrix product states to efficiently simulate the real- and imaginary-time dynamics for infinite one-dimensional quantum lattices. This procedure (i) is argued to be optimal, (ii) does not rely on the Trotter decomposition and thus has no Trotter error, (iii) preserves all symmetries and conservation laws, and (iv) has low computational complexity. The algorithm is illustrated by using both an imaginary-time… CONTINUE READING